Mutual Relationship of Strategic Stances and Formulation Methods, and Their Impacts on Performance in Public Local Transit Agencies

Abstract

This study is a continuation of previous work that emphasizes an alignment between the internal management (strategy formulation) of public organizations and their environment (strategic stance). As public organizations formulate strategy through strategic planning or logical incrementalism, they relate to their external environments through the strategy stances of prospector or defender. Current research asserts that organizations with a prospector stance perform better when they adopt logical incrementalism, whereas organizations with a defender stance perform better when they formulate their strategy through formal strategic planning (FSP). Our study on the transit industry, however, could not find support to these assertions.